Energy Efficiency Improvement in MSME through EESL’s ..._CII_Greenco_Summit_29062018... ·...

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Private & Confidential © Edelman India Pvt. Ltd.

Government of India

Energy Efficiency Improvement in MSMEthrough EESL’s Business Models

EESL’s Initiative29 June 2018


Energy Efficiency Market in India

� Estimated to be 22.81 billion $ (Source : EESL’s Business Plan 2016-2021)

� Policy interventions and Support by Multilateral/Bi lateral organizations resulted emergence of domestic and international ES COs

� Major constraints of ESCO• Limited Access to Finance • Limited Capacity in Public Sector• Government Procurement Regulations• Perceived Technology Bias• Lack of Simplified M&V Protocols• Payment Security Mechanism

Need of a Super ESCO• Undertake Risk

• Demonstrate Energy Efficiency ESCO models

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Energy Efficiency Services Limited (EESL)

� A public Energy Service Company (ESCO) under Ministry of Power, Govt. of India

� Established in the year 2009

� 100% share holding with Public Sector Enterprises

� Board of Directors represented by Ministry of Power and Bureau of Energy Efficiency (BEE)

• NTPC Limited (India’s Largest Power Generating Company | Market Cap as on 1st March 2016 – US $15.5 billion)

• Rural Electrification Corporation Limited (Market Cap as on 1st March 2016 – US $2.4 billion)

• Power Finance Corporation Limited (Market Cap as on 1st March 2016 – US $3.1 billion

• Power Grid Corporation of India Limited (India’s Largest Power Transmission Company | Market Cap as on 1st

March 2016 – US $10.7 billion

EESL is a joint venture company of four Public Sect or Enterprises of Ministry of Power, Govt. of India

� Largest ESCO in the world

� Backed by Government of India and Promoters with net worth of over $32 billion

� Implementing largest Energy Efficiency Portfolio in the world

� One of the fastest growing companies in India – 10 fold growth in one year


Turnover & Pipeline of Projects

Turnover : US $10.5 mn (2014-15), US $110 mn (2015-16), US $300 mn (2016-17)

151Projects

worth

$170 m

LED Bulb Segment

240Projects

worth

$926 m

LED Street Lighting

Projects worth

$700 m

Agriculture DSM

Projects worth

$75 m

Buildings

Projects

worth $2 billion

Overall

Expected Project worth :

$6-7 b over next 3-4 years – Includes 10 mn fans, 1 mn agriculture pumps, municipal pumps, smart metrs, buildings, etc

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National Motor Replacement Program


Need for the National Program

•About 90% - 95% installed motors are of IE1 or IE0 base, which are typicallyenergy inefficient.

•Recent DIPP Quality Control Order necessitates all new motors (imported ordomestically produced) to be minimum IE2 compliance.

•India can leap frog to best available IE3 motors (new addition as well asreplacing old ones).

•EESL brings first voluntary Motor Replacement Program to accelerate theCHANGE.

•End users to benefit from electricity consumption and extended warrantyperiod.

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Program Design Characteristics

• Program Administrator: EESL

• Target Group : PAT Industries, SMEs

• Application: Motors in 1.1 kW to 22 kW driving

Pumps, Fans/Blowers and Air Compressors

• Financial Model : ESCO (on deemed saving approach) and PMC (10% of the Project

Cost)

• Project Duration : 3 years• Procurement : Open bidding process as per

defined technical specifications

• Warranty : 3 years• Supply & Installation : Supply is by EESL,

Installation by industries

• Post Installation Verification : On sample basis by EESL

• Value Addition : Motor Price Reduction,

extended warranty.•

Confirmed Demand so far : 70,000

Motor Size (kW) of IE-3 Specification

Target Numbers for Replacement

1.1 15,0001.5 15,0002.2 15,0003.7 15,0005.5 15,0007.5 15,00011.0 10,00015.0 10,00022.0 10,000


Program Design Characteristics

Particulars Conventional Model EESL ModelMotor Type IE1 or Less

(Sub-Standard Efficiency)

IE3

(High Efficiency Class)

Pricing Retail/Supply Price by Supplier At least 30% reduction from

retail/supply price

Procurement Process By Client By open bidding

Price reduction Mechanism No Bulk Procurement

Investment By Client By EESL

Repayment --------- Through instalments from monetized

energy saving

Warranty 18 months 36 months

Installation By Client By Client

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Key Features

PreImplementation

Inventory Collection

Procurement by EESL

Investment

Installation

To be undertakenby customer

Post Implementation

Warranty(Extended)

Sample based quality check

Selective Replacement

Operating Model of the Program

Company 1

Company 2

Company n

Participating Vendors

Tenders floated for Procurement

Supply of Motors

Distribution by

Suppliers under

supervision of

EESL

Supply

Implementation by Industry

Payment

3-Year Warranty (EESL Call Centres or Directly to Supplier)

EESL Outreach

Agency

Outreach Program Planning Consumer Outreach Program

1

2

3

4

5

6

7

8

9

2

Only PMC

Upfront Payment

Equated Quarterly

Instalments

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Case Situation• Number of Motors:50 nos. Baseline Efficiency Class:IE-1

• Baseline Parameters: 5.5 kW , efficiency 84.7%, loading 70%, 313 days/annum, 20 hours/day

• New Parameters: Efficiency classIE-3, 5.5 kW, efficiency 89.6%, loading 70%, 313 days/annum,20 hours/day

• Baseline Annual Energy consumption: 14, 22,727 kWh (=50x(5.5/0.847)x0.7x313x20)

• New Annual Energy consumption: 13, 44,922 kWh (=50x(5.5/0.896)x0.7x313x20)

• Annual Energy Saving:77805 kWh (=14, 22,727-13, 44,922) =5.46 %

• Monetized Annual Energy Saving @ Rs. 8 per kWh : Rs.6,22,440

• Cost of per motor = INR 6,73,000 for 50 motors @ Rs. 13,471 per motor

• PMC Fee to EESL = 10% of (Rs.6,73,000) = Rs. 67,300

• Total Capital Cost = Rs. 8,74,250

• Total Repayment to be made to EESL in 3 years = Rs.9,92,628


Repayment through Monetized Energy Saving

Bas

elin

e C

onsu

mpt

ion

14.22,727 kWh

Targ

et C

onsu

mpt

ion

13,44,922 kWh

7780

5 kW

h S

avin

g

Annual Monetized Saving

(Rs. 6,22,440)

Annual Repayment to EESL

(Rs 3,30,877)

Annual Retain of Saving by Client

(Rs.2,91,653)

54%

46 %

Project Period : 3 YearsProject Cost :

Material Cost + PMC + ROI Warranty : 36 Months

A

B

AB

Repayment to EESL through Equal Quarterly Instalments

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Result of Pilot Studies

Average Energy Saving 13-15 %

Increase in Speed0.6 to 2.2 %

Decrease in Bearing Temperature8.4 to 17 %

Decrease in Vibration3.0 to 5.6 %


Pricing after 1 st Bidding

S.No. Rating (kW)Typical Market

Price/ Motor (Rs)

EESL Price

/Motor (Rs.)

1 1.1 7625 5159

2 1.5 8388 6250

3 2.2 11002 7466

4 3.7 14051 9463

5 5.5 19584 13143

6 7.5 23018 15538

7 11 47045 25070

8 15 49223 30574

9 22 64688 39859

CG

ABB

Siemens

BBL

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Homepage



Website URL Click Here to Send Enquiry

Click on Tabs for Info

Send E-mail on this Id

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Sending Enquiry-Login Page

Click here to Sign Up Click here to continue as Guest

Enter details if already registered.


Sending Enquiry-Registration Page

Fill your details here.

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Sending Enquiry-Registration PageYour Login Id & Password

will be sent on your shared mail id.


Sending Enquiry-Login Page

Enter your Login id –Password & Enter

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Client Dashboard

Check the Status of Enquiry Sent /Proposal received etc.

Click here to send New Enquiry


Send New Enquiry

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Sample Enquiry

Click here to Submit


Enquiry Status

Check the Status

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Enquiry Status

Check the Status


Proposal Received from EESL on Sent Enquiry

Download the .pdf file.

Choose the option

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Proposal Received : Client Selects Review

Post your comment here on the proposal


Proposal Received : Client Accepts

Post your comment here on the proposal

Select your Engagement type here

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Agreement Received by Client

Download your copy from here.


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Market Transformation in Energy Efficiency in SME Sector of India

GEF-5 Project

34

Project Framework – GEF 5 Project

Budget Head Million USD

Grant 4.46

Co-Financing 6.86

Investment 20.0

Fin

an

cin

g

10 SME

Clusters

Technology

Mapping

Select 35

Technologies

Studies, Surveys,

Secondary Research,

Cluster Meetings

Demonstration of

Technology

Tech

ProviderLSP

Establish M&V

Proof of Concept

Demand

Aggregation EMRF

Technology Deployment /

Implementation

Bulk

Procurement

Re

pa

ym

en

t

Monetized

Saving

26.86 mn $

EESL Grant : 3.0 mn USD

EESL Invst. : 20.0 mn USD

Total Budget: 31.32 mn USD

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EESL’s International Initiative

Thai Auto Parts Supply Chain Development throughEnergy Efficiency (TAPEE) Program

• Identification of 20 mid-to-large units and 200 small units for baseline data collection and energy audit.

• Energy Audit of the identified SME units for baseline estimation and identification of energy saving opportunities and submission of report.

• Discussion with the industry association, GGGI, PEA for necessary engagement of energy audit work and demand assessment activities.

• Identification of EE technologies with highest energy saving and replication potential – hence good investment portfolio

• Development of Energy Efficiency (EE) proposal with projected cost savings from EE upgrades.

• Development of guidelines and support PEA to monitor report of electricity bills and conduct M & V of the projects and quantify the energy savings.

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SME End Users

PEA

Local FIs

Energy Audit + ESCO Service

ECCT

Single Bill payment (Electricity + Service

fee)

EESL (ESCO)

Electricity

Repayment

GGGI 1. Whole program development, monitoring2. Financial arrangement3. Government relationship

1. Loan to ESCO or End users2. Introduce end users

EE Guarantee fund/insurance

1. Support develop OBR scheme2. Introduce clients, EA support 3. Dissemination support4. M&V support

GCF, Donors

Debt/Guarantee/Grant

Repayment

Loan

AE (e.g. ADB)Energy Audit support

Guarantee

Premium

Debt Repayment

IIEC1. Technical Advise2. Documentation of EE

Guarantee/RSF, OBR/OBF, incl. OMs

1. Energy Audit2. M&V 3. Funding Proposal development 4. Introduce members 5. Dissemination

Business model for TAPEE program

ESCO Service fee

Program Status

� Project Agreement signed with GGGI: October 2017 (125,000 US $ )

� Consortium Partner : ECCT, Ministry of Energy, Thailand

� 1st Consultation Meeting : Conducted during Oct 2017

� Energy Audit in 120 SMEs : On-Going

� Inception Report : Submitted to GGGI on 15th Dec 2017

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Energy Efficiency in Corporates / Industries

A Case Example

Mahindra’s work with EESL

• LED project

• Energy Efficient Motor – Pilot Project

Energy Efficient AC – Pilot Project

• “UJALA” Scheme for employees

• Energy Audit and Capability Building

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LED Lights Installed

17 Locations – 1.6 Lakhs

Investment

Rs. 15 Crores

Estimated Energy Saving

200 Lakhs kWh/annum

LED project

Estimated CO2 Emission Reduction

16400 Tons/annum

Tube lights High bay lights Down lights

30,000 LED Bulbs and 5000 Super

Efficient Ceiling Fans distributed

Potential Energy Saving

12.4 Lakh kWh/Annum

CO2 Emission Reduction

1024 Tons/annum

UJALA scheme launched at 17 locations pan India

Launched UJALA scheme for M & M Employees

Engagement with

20000+ Employees

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Payback 12-18months

Suitable for most applications like pumps,

blowers etc

Improved EnergyEfficiency

IE3 motor installed at 6 applications in M & M by EE SL

Pilot Project Observations

Pilot Project – Premium Energy Efficient Motors

Conducted Energy Audit at Plants

Conducted training program on Eenergy Conservation

Energy Audits and Imparting Trainings

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Contact Us:

Energy Efficiency Services Limited(A Joint Venture of PSUs of Ministry of Power, Govt . of India)A-13, IWAI Building, 4th Floor, Sector - 1Noida – 201301, Uttar Pradesh, India

Email: [email protected] , [email protected]: www.eeslindia.orgPhone: +91 120 490 8000

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